Archive for the ‘Singapore’ Category

As the economic centre of the world shifts to the East, so is the centre of high performance in school education. Four of the world’s five highest-performing systems are Hong Kong, Korea, Shanghai and Singapore, according to OECD’s 2009 PISA assessments of students. InShanghai, the average 15-year old mathematics student is performing at a level two to three years above his or her counterpart in Australia, the USA and Europe

In recent years, many OECD countries have substantially increased education expenditure, often with disappointing results. Grattan Institute’s new report from its School Education program, Catching up: learning from the best school systems in East Asia, shows how studying the strengths of these systems can improve our children’s lives.

Success in these systems is not determined by culture – by Confucianism, rote learning, Tiger Mothers etc. – nor is it always the result of spending more money. Instead, these systems focus on what is known to matter in the classroom – a relentless, practical focus on learning, the creation of a strong culture of teacher education, collaboration, mentoring, feedback and sustained professional development.

Many western countries have begun to introduce versions of the reforms that these East Asian systems have implemented, or are talking about doing so. Most have much further to go. This report provides an extensive assessment of how other countries can implement the lessons of these high-performing systems.

THE Republic’s prowess in math and science may not turn its students into the innovators and entrepreneurs needed to drive the economy in the long-run, says the Singapore Competitiveness Report 2009. While Singapore has established its tertiary and research institutions, and patenting and publication intensity has grown, entrepreneurship remains low and local rather than export-focused.

The current competitive strengths are more in line with a ‘high-skilled, investment-driven model’, rather than the ‘innovation-driven economy’. Singapore needs to reconsider its position among the host of economies hoping to be innovation nations. It does well on many global innovation rankings – but better on ‘those that focus more on general business environment conditions than on specific economic returns on innovation’. In fact, Singapore’s profile of relative strengths and weaknesses are more similar to economies like Armenia, Peru and Uganda, the report says. Hong Kong, too, showed itself to be stronger than Singapore on innovation performance vis-a-vis innovation inputs.

The report raises ‘a concern that Singapore focuses too much on the type of repetitive memorization of knowledge that generates high performance on standardized tests.’ But the authors’ main issue was with the overly ‘science-leaning’ nature of the innovation system. ‘There is a need to mentally break free from the US model, from wanting to replicate what Silicon Valley or Boston does,’ said Christian Ketels who says Singapore has not the depth nor breadth of funding from venture capital or large corporations to generate breakthrough technologies and products quickly enough.

As Clancy Yeates pointed out in the Sydney Morning Herald in December, Bhide’s thesis is that the “techno-nationalists” are fighting the wrong battle – no one disputes R&D is critical for creating economic wealth over time, but it’s too simplistic to see the benefits of a new idea going only to the country where it takes place.

Instead, globalisation means the benefits of a good idea can be spread throughout all the links in the chain of production. And it’s not always the inventor who benefits.

For example, the iPod has been tremendously profitable for Apple – sales of $150 million and climbing – but it was invented by Singapore’s Creative Technology and in fact received $100 million from Apple for a patent infringement. But Apple’s contribution was to create a novel fashion item, which led to spectacular sales, especially in the US. iPods are assembled in China with parts from elsewhere in Asia, but Bhide says the value add through marketing, selling and distributing iPods in the US is about the same as its production value.

In short, the iPod is an example of how US needn’t be locked into a “winner takes all race for scientific and technological leadership” – innovation on foreign territory has helped the US economy.

In 2007, Singapore identified the Clean Energy sector as a strategic growth area.

Building on this, the Singapore Economic Development Board announced a joint venture between VDE Institute and Fraunhofer Institute for Solar Energy Systems (ISE). VDE Institute is an EC institution that tests and certifies electrical appliances, components, systems etc. while Fraunhofer ISE is a well-known German research institute.

The SEDB claims the deal is a strong endorsement of the nation’s efforts at developing its solar energy industry, and that it’s the first Southeast Asian hub for solar photovoltaic testing and certification.

The SEDB further trumpets that it’s a ‘new milestone for the local solar industry’ and is the latest addition to an already vibrant Clean Energy sector. It breathtakingly notes that companies such as Renewable Energy Corporation, Oerlikon Solar and Norsun have already set up shop, and that the industry is forecast to contribute US$1.2 billion to GDP and to create 7,000 jobs in manufacturing, training and R&D by 2015.

However we looked more closely at the information provided, and we determine that JV is valued at only US$550k. We all tend to forget that Singapore is smaller than the economy of Victoria. (We still admire their proactive industry policy).

§UK leads the world in its recognition of the creative industries. The Cox Review of Creativity in Business examined how to exploit creative skills more effectively (UK Treasury 2005). The Design Council is important – now runs a program ‘Designs of the Time’ (DOTT) and a new program, ‘Designing Demand’ helps SMEs become more competitive – offers flexible, structured processes, using expert Design Associates with business experience.

§ New Zealand has launched a design strategy and is looking to breed a cohort of design-led firms — brand builders based on ideas grown in New Zealand.

§ The German Design Council (Rat für Formgebung) is a world leader in competence centres for communication and know-how transfer in the design field. Runs competitions, exhibitions, conferences, consulting, research and publications.

§ The Swedish Industrial Design Foundation (SVID) improves awareness of the importance of design as a competitive tool, and encourages the integration of design methodology.

§The Indian Government released a national design policy in 2006. It includes a ‘Mark of Good Design’ – only well-designed products can carry the mark. The aim is to ensure that the words ‘Designed in India’ come to mean good value. India is seeking to become a global design hub. Currently a roll-out of design-led business and academic centres.

§Taiwan has a robust design policy, supported by a growing number of design schools.

§ South Korean students outnumber all other nationalities in most graduate design programs in the United States, and Samsung is an upcoming innovator.

§China is shifting its manufacturing base from OEM to original design manufacture and brand-manufacturing operations. In 20 years, China has opened 400 specialist design schools to train designers and build design capabilities.

§Singapore is creating centres to bring business and design and creativity together.

Thanks to Hari Argiro (Adelaide CC) for pointing us to John Howard’s article.

Merrill Lynch says its petrochemicals segment hasn’t been affected by the oil price hike – on the contrary. Saudi Basic Industries Corp (SABIC) predicts Asian demand for petrochemicals would outstrip the combined demand of the US and Europe within two years. To understand, just consider the end products – plastic bags, packaging, textiles, car parts, electronics – and their relevance to Asia’s increasingly wealth.

Singapore has been actively building its petrochemicals capabilities since it opened SE Asia’s first petrochemicals complex in 1984. Today, there is even a dedicated island – Jurong Island – hosting 95 companies including heavyweights ExxonMobil Chemical and Shell. Companies benefit from industry integration – sourcing raw materials and selling products over the fence, and sharing common pipeline services and other utilities.

The latest boost is synthetic rubber supplier Lanxess AG’s decision to invest in a €400 million butyl rubber facility to meet demand from auto tyres.

Technology is a critical enabler, and Singapore is investing heavily in petrochemicals R&D to become a “first implementer” of technologies, as well as a technology creator. It has its sights set on new process routes and novel applications. Indeed, Singapore’s Agency for Science, Technology and Research fosters research talent e.g. the Institute of Chemical and Engineering Sciences, sited on Jurong Island, does research work in biocatalysis, catalyst screening & optimisation, bioprocess engineering, and protein engineering.

The unstinting efforts of Cockatoo member, Geoff Mullins, were rewarded on 28 March with the launch of the Asia Pacific Technology Exchange by local federal member Maxine McKew MP. She said that ‘this is the innovation economy at work.’

The Exchange is designed to help establish a Silicon Valley-style business cluster in northern Sydney.

The launch also attracted global attention – excerpt of the article in the International Herald Tribune follows.

SYDNEY — A new Australian exchange, aiming to emulate the U.S. Nasdaq index with a focus on technology and innovation stocks, was established Wednesday with plans to become fully operational by the second half of 2008.

The Asia Pacific Technology Exchange, or Aptex, is a joint venture of the National Stock Exchange of Australia and Enterprise Pacific, a not-for-profit company. Based in Sydney, the venture plans to start with a minimum of 20 listed companies. The chairman of Enterprise Pacific, Geoff Mullins, said the new exchange expected to have 200 to 300 companies listed within its first 2-3 years. Mullins said he was not concerned about liquidity on the new exchange, which had been a problem in earlier attempts to establish exchanges in Australia, because of support from brokers and from connections being forged in the Asia-Pacific region. ”We are absolutely certain that this is under way. We have stakeholders signing up, we have companies signing up and we are ready to go.”

NSX had held discussions with stock exchanges in Korea, Malaysia, Thailand, Singapore, PNG and Fiji on their possible participation. Inquiries had also been received from companies in Taiwan and Korea, and it was possible that 5 of the first 20 companies on the exchange could be Asian. Mullins estimated the total market capitalization of companies listed on the exchange to initially be between $350-650 million.

In the early 1980s, Ms. Bobby Graham (now of Wagga Wagga NSW) was working for a prestigious Afrikaans general book publisher in Capetown. Her company and mine recently collaborated on inputs to a federally-sponsored development agenda for the printing/publishing industry. A great insight:

We were approached by a Singaporean printer, and I remember my boss inviting me to join in the initial meeting when the representative paid us a visit. Living and working at the southernmost tip of Africa you can appreciate that we were rather surprised by this overture and approach.This was the first of various Singaporean print representatives who called on us over a period of most probably ten years. What struck me most was the following:

Unlike local printers, all the representatives were well spoken, well educated and well travelled business graduates. They never pushed a hard sell approach, but always enquired about ourselves, our families, our work situation.

They openly discussed their attempts to get work from our competitors. They were extremely good at following up after all visits even if we didn’t give them anything on which to quote. You could be certain of a follow-up phone call (from Singapore) – and if we did request a quote, this was faxed (pre-email) within days (as opposed to weeks sometimes from local printers).

They persisted in developing a relationship, even if sometimes it might take a year or two before they got a print job. We didn’t print enough full-colour books to warrant printing offshore in large numbers, but when we eventually were able to take up their offers, we were delighted with the quality and service. Deadlines were always met and kept (we made very sure that we presented our jobs exceptionally well to avoid any costly long-distance changes).

When I visited them in Singapore, they were all extremely hospitable and went out of their way to ensure I was collected from the airport, delivered to my hotel, fetched to visit the factory and guided throughout all operations. At all the printers, but especially at Tien Wah, I was impressed by the efficient flow of the work stations moving as they did from the office staff (estimators) through pre-press, to print, binding and finishing before being despatched directly into waiting containers. The different department staff wore different coloured T-shirts. This increased their team spirit, but also quickly identified those workers who were out of place. Each individual work station had a target chart, clearly visible to co-workers and visitors and these were translated into wall-mounted charts for each division.

Obviously it was very clear what their targets were – 90% of their work was for offshore clients.

It involves a cell-culture production facility in Singapore to support its growing pipeline of biopharmaceuticals. It is due for completion by 2012.

The plant, to be located near Novartis’ existing operation producing drugs from chemically synthesised substances, will support both clinical and commercial production of potential new products including monoclonal antibodies to treat rheumatoid arthritis, oncology, asthma, spinal chord injury etc. At full capacity, it will employ 300 workers and produce drugs using mammalian cell culture technology.The investment is part of the Novartis Biologics unit, which brings together key elements for fast, high-quality R&D activities in biological medicines manufactured via laboratory-created processes involving living cells. Biologics now accounts for 25 per cent of the Group’s clinical research pipeline.Says Thibaud Stoll, Head of Global Biopharmaceutical Operations, Novartis“We have six facilities at the moment in biopharmaceutical operations – five in Europe and one in California. This new one will expand our operations in Asia and also in biopharmaceuticals.”

The investment follows Novartis’ new tablet facility in Tuas, Singapore (US$180 million), which will manufacture existing Novartis pharmaceutical brands, such as Diovan® – the world’s most prescribed high blood pressure medicine – and new products like Tekturna®/Rasilez®, the first of a new type of high blood pressure medicine. By 2011, the 28,500 sq. m. plant will be manufacturing around 3.3 billion tablets with 160 staff and lean-manufacturing practices.

About Novartis

Novartis was rated No. 1 among pharmaceutical companies worldwide in Fortune’s 2007 ranking of “Most Admired Companies”. Headquartered in Basel, Switzerland, Novartis’ presence in Singapore began in 1971, with the opening of Ciba-Geigy. Following the merger in 1996 between Ciba-Geigy and Sandoz, Novartis was created, with the company establishing its Asia-Pacific head office in Singapore.

Its other local operations include the Novartis Institute for Tropical Diseases (NITD), which holds the mandate for discovering and developing therapies for neglected diseases, including dengue and tuberculosis, and a production facility for the CIBA Vision Business Unit, part of Novartis’ consumer health business platform that also includes over-the-counter medicines and animal health products.

In Singapore, Novartis employs over 800 people, across pharmaceuticals, consumer health and vaccines and diagnostics. Activities include marketing, R&D, manufacturing and regional management.

Why Singapore?

The Singapore Government views these latest investments as a clear signal of the tremendous growth potential for Singapore’s biologics and pharmaceutical manufacturing industry.

In 2006, Singapore’s biomedical sciences output grew 30% to US$15.9 billion. It now boasts 25 pharmaceutical and biologics manufacturing facilities, with other heavyweights GlaxoSmithKline, Genentech, Abbott and Lonza all taking advantage of the region’s business benefits.

The Singaporeans claim it has a reputation as the most competitive and trusted site for pharmaceutical bulk activities and secondary manufacturing, and is now aggressively pursuing investments in biologics. In less than two years, Singapore has attracted five biologics investments totaling over US$1.5 billion.They see Novartis’ investments in Singapore as a significant endorsement of the island state as a value-adding partner to world-class pharmaceutical companies.

Says Lim Hng Kiang, Minister for Trade and Industry:

“The biotechnology facility will be the first biologics manufacturing investment in Singapore by a pharmaceutical company and our fifth commercial scale biologics plant to date…it further reinforces Singapore’s position as a leading location for world-class biopharmaceuticals manufacturing.”

There are 4,000 people employed in the local pharmaceutical/biologics sector, with 2,000 more required over the next three years. Lim says the government has been working closely with companies like Novartis to further augment its pool of skilled manpower to support this industry. A program to develop skilled pharmaceutical workers without prior experience in the industry will be launched soon.

According to Novartis, Singapore was picked as the ideal location for its new facilities after a thorough selection process. Says Tom Van Laar, Head of Global Operations, Novartis Pharma AG, “Singapore is attractive because of its increasingly strong biomedical cluster and proximity to growth markets in Asia. In addition, a solid educational system and favourable socio-economic conditions assure access to local and international talent.”

Australia’s view

The Singapore investment has been greeted with muted dismay by Australian industry analysts.

Novartis Australia is headquartered in North Ryde, in the biotech corridor in northern Sydney, where there is talk about action to create a true cluster to match that of Singapore.

Total employment across Australia is around 500, and Novartis’ annual R&D spend is reportedly around $27 million.

It was envisaged that Novartis would view Australia as its Asia Pacific node and keen to be part of recent talk about Australia becoming a global centre for clinical trials.

As officials are keen to explain, Australia has a much superior R&D base in biotechnology, with a strong history of Nobel Prize winners etc. Singapore is also viewed as an economy with a population smaller than that of Victoria, and artificially sustained by government subsidies.

However the real problem appears to be that the talk about Australia becoming a global centre for clinical trials has not progressed into any tangible policy or initiatives. Australia’s reluctance to play the subsidy game, as well as its current labour shortages, were thought to have been the other main factors in favour of Singapore.

As more nations recognize the importance of entrepreneurship, their governments are reforming rules and regulations to ease the business development process.

The latest edition of the World Bank’s Doing Business report shows that these trends are taking hold. The number of new business starts in Eastern Europe now surpasses the impressive numbers found in East Asia.

Meanwhile, many long-time laggards, like Egypt, Croatia, and Ghana, now appear on the lists as “top reformers” i.e. governments that have implemented major reforms in their business regulation systems.

Overall, Singapore takes the top spot as the easiest place to do business. Rounding out the top 10 (in order) are New Zealand, USA, Hong Kong, Denmark, UK, Canada, Ireland, Australia and Iceland.